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Offshore asset protection through trusts for entrepreneurs on the Internet

Protection of assets for entrepreneurs on the Internet is an article addressed to all my friends who begin their wealth through this wonderful technology, where the only intention is to guide them to start their business legally and at the same time obtain tax benefits. Today new generations are moving quickly to work on the Internet, new entrepreneurs are turning to the Internet instead of physically establishing a company, they are saving highly significant amounts in an income of a local or an office, including savings of expenses that are needed when working in a physical place, such as electricity, water, parking, receptionist, security, cleaning equipment, etc., today people prefer to work with a simple computer and from their home, where the Internet gives us the power to quickly become entrepreneurs.

Having a business on the Internet is already well established in Asia and Europe, I mean there are already many people doing it, and this is starting quickly in Latin lands, today entrepreneurs instead of renting a place as for example to establish a clothing boutique, prefer to set up their online store and sell clothes through the Internet, it is clear that many Latin Americans still do not trust buying on the Internet, however this will change in a few years, and the smartest will have their benefits.

If you are one of those smart ones who are searching for «Innovation» through the Internet and have already taken the first steps, it is CONGRATULATION. Although I know that if you are reading this article it is because maybe you feel something lost about the legal issue of your Internet business, and of course worried about the protection of your assets, so I will tell you an excellent option to be able to cover both needs.

Why register your company on the Island of Nevis? – Asset protection for entrepreneurs through offshore trusts

  • There is no public registry of companies in Nevis
  • The island of Nevis is a leader for asset protection
  • Companies in Nevis do not have taxes
  • Nevis does not have exchange controls
  • PRIVACY and ANONYMITY, since your information is not available to the public
  • You can make use of MANAGERS NOMINEES
  • They are well seen by banks, with which you can open a bank account abroad without problems.

Documents required to register your company abroad:

  • Certified copy of Passport
  • Proof of address (three months)
  • Banking recommendation

Asset protection means security for you as an entrepreneur and your family, please do not leave this to chance, contact us via Offshoreciitzen.net site to start protecting and diversifying your assets.

Malta Trusts for Asset Protection

Creating an offshore trust to protect assets in Malta

The principles of trust are the same in all jurisdictions; trusts must always have a trust founder, a trustee, a beneficiary and a guarantor. The founder transfers its assets to a trust, where they will be managed and managed by the appointed trustee. This trustee will act as a third party between the founder and the beneficiary, which received all the assets. As a result, the founder loses all property rights. A declaration of trust is usually drawn up, which specifies the specific requirements of the founder, which must be fulfilled before the beneficiary gets access to the assets. There may be a need for a guarantor to ensure that the trust of the trust declaration is consistent with the activities and to ensure high management standards on the part of the trustee.

What is the purpose of creating an offshore trust in Malta?

Despite the fact that Malta is the smallest state of the European Union, it was not affected by the recent economic crisis and a healthy political and financial climate was preserved here. Recently (in 2007) Malta enacted a law facilitating the creation of offshore trusts in Malta. Prior to the introduction of this law, trusts in this jurisdiction did not exist. However, as a result of the developing financial infrastructure of the Government of Malta, it was decided to establish offshore trusts in the jurisdiction.

What is an offshore trust in Malta?

The declaration of the creation of a trust must be submitted in writing, this can be done in the form of a unilateral declaration, will or any other form of the written document.

A trust in Malta will be a legal entity if the founder, not the beneficiaries or the trust itself, is located in Malta. In addition, an offshore trust in Malta cannot own real estate in Malta and shares of a company registered in Malta.

Purpose of an offshore trust in Malta

Since the trusts were a relatively new institution in Malta, there was an opinion about them that they were intended for very rich people and that the procedure of their establishment is so long and expensive that it does not justify the final result. However, all this is very far from the truth. In some cases, a trust can be created in 48 hours, and it can have a variety of purposes, depending on what benefits you expect from it. Assignment of trusts:

– Asset Protection

– inheritance planning

– Providing benefits to children

– Benefit for employees

– A trust can also be used for charitable or social purposes.

The main reason for creating an offshore trust is to protect the status of the founder and to take care of future generations of the family or the designated beneficiaries. Malta has the best asset protection thanks to a stable and developed financial and political structure.

Advantages of an offshore trust in Malta

The advantages peculiar to the Maltese trusts include:

– Highly favorable tax climate

– A high degree of confidentiality and anonymity in Malta – trusts are created and operate in an atmosphere of confidentiality

– Assets can be protected and controlled accordingly.

– There is no need to prove the authenticity of instructions – the assets of deceased founders may be distributed according to the instructions of the founder, and not at the discretion of the governing bodies

– Income from fund assets is tax-free

– In Malta, there is no stamp duty and tax on inherited property

– There are no controls and restrictions on currency exchange

– Trust assets may be imported into Malta without paying any customs duty.

Creating an offshore fund in Malta

Funds are a corporate version of the trust. Funds can own many corporations and assets, and become legal entities immediately after establishment. This means that the funds operate under their own name and can act in the courts as plaintiffs and defendants. Funds can also enter into agreements with third parties. The main principles of the foundation imply the presence of the founder, guarantor, beneficiary, and members of the board.

After its establishment, the foundation in Malta acquires the qualities of a legal entity and, accordingly, does not have a specific owner. In Malta, foundations function in the same way as trusts — there is a declaration in the funds describing the requirements for the operation of the foundation. Funds can be used for various purposes, but mainly they are intended for commercial, charitable or private use. Malta funds are an excellent investment protection tool.

Types of funds in Malta

The activities of foundations in Malta are based mainly on the provisions of the civil law of France and Italy, i.e. it is possible to create both public and private foundations within the framework of Maltese jurisdiction. According to the laws of Malta, funds can be of two types: “private funds” and “trust funds”.

Benefits of Foundations in Malta

– Tax benefits in terms of avoiding double taxation of capital gains

– Efficient and structured distribution management system and state management

– Reduced Inheritance Tax

– Payment of reasonable compensation for the services you provide to the fund

– Asset Protection

– donations to the fund are excluded from taxation

Wills per billion. How to transfer foreign assets to Russian heirs

The transfer of foreign assets to the heirs will soon become an urgent issue for the first generation of wealthy Russians. What mechanisms exist to solve this problem?

Wealthy Russians keep a significant portion of their assets abroad. According to the National Bureau of Economic Research (NBER), Russian businessmen hold funds in banking and brokerage accounts in tax havens equivalent to about half of Russia’s annual GDP ($ 590 billion).

Dmitry Kip, Director of QBF Investment Banking Department, estimates that the moderately conservative investor with a large check has the following proportions in the foreign portfolio: 50% of capital – real estate, 20% – deposits, 15% – securities on a broker account or in trust, 5% – business (as a rule, shares in the company), 5% – the rest (funds and trusts, private loans, yachts, airplanes, art objects, automobiles, jewelry and metals lying in bank cells, etc.).

“For a conservative investor, the share of real estate can go up to 80-85%. These are mainly European properties (75%), North America (20%), Asia (5%), ”he adds.

The procedure for transferring a legacy of foreign assets is fraught with a lot of nuances and legal subtleties. In different countries – different terms of entry into the inheritance, and unclaimed assets often go to the state treasury. At the same time, the inheritors will have to collect funds that are not “fixed” by a notary, literally bit by bit, encountering obstacles related to bank secrecy and unwillingness to share information on customer accounts, as well as the lack of legal assistance contracts between specific countries.

In the Russian legal field

When preparing a will in the Russian jurisdiction, it is possible to include foreign assets in it. In this case, the procedure for transferring an inheritance can be applied both from the law of the country of which the testator was a citizen and in the country where the assets are located.

The testator must pay close attention to the legislation of the countries where the objects of inheritance are located. “Everything should happen to take into account whether Russia has specific agreements in the form of international legal assistance treaties with the countries where the objects of inheritance are located,” explains Alexander Zakharov, a partner at Paragon Advice Group. “Because if there are no such grounds, then it will be problematic to execute such acts on the territory of a foreign state, and you can only rely on the goodwill of foreign officials.”

Thus, the first thing worth starting a Russian testament, which includes foreign property objects, is to make sure that agreements are signed with this state that simplifies the recognition of Russian official documents on the territory of this country. Russia has such agreements with more than 100 states, including Germany, Bulgaria, Great Britain, Brazil, Denmark, Spain, and Ireland. Otherwise, you can not meet the deadline for the entry into the inheritance of another country, limited to 6-12, and in some countries even 3 months, lawyer Kaloy Akhilgov notes.

You also need to remember that in the EU since 2015 there is a law that changed the rules for inheritance of real estate. “The owner of the property with the help of the will can give preference to the law of the country of his citizenship, be it an EU country or any other. This law does not apply in the UK, Denmark, and Ireland, ”explains Ekaterina Markova, head of inheritance practices at UFG Wealth Management.

The difficulty of transferring business and shares through the Russian testament is that the testator must clearly identify the transferred assets. “It is necessary to indicate numbers, series, data on the issue of securities and other unique information. There are no provisions on the inheritance of business in Russian law, the procedure may concern only specific objects of ownership, ”explains the lawyer, chairman of the Moscow Bar Association Legal Aid and Protection, Olga Sulim.

To simplify the inheritance process, business assets can be transferred to a holding company. It is usually created for the organization and optimization of financial flows – including to address issues of inheritance. The holding company, while the heirs are undergoing the procedure of accepting the inheritance, can be managed by a pre-appointed executor of the will. Among the most popular jurisdictions for creating a holding are Cyprus, the United Kingdom, Luxembourg, Denmark, and the Netherlands.

Depending on the specifics of the assets, a Russian holding may be suitable, although a foreign holding, according to experts, is still preferable. “In this case, the heirs will not need to accept the inheritance in many different countries, but only in Russia. However, the law of the location of the holding company (for example, the BVI) may provide for the need to undergo a probation procedure to inherit shares, ”says Arslan Dyakiev, lawyer of the practice of providing services to private clients of PwC Legal.

With regard to the transfer of inheritance of securities – until the receipt of the certificate of inheritance (in Russia it is 6 months), credits, deductions, transactions, and operations can significantly change the value of the property. If this option is acceptable, the securities can be transferred to the account in the Russian depository.

“If we are talking about stocks and bonds of foreign issuers that are publicly circulating in Russia, there should be no problems with servicing and crediting to the securities account of the potential testator. If the papers do not circulate publicly in Russia, they can be credited to the depot account by a qualified investor, ”commented Sergey Volodkin, head of the legal support department for the activities of the professional participant of the Finam Group of Companies.

Abroad

A will made for each specific foreign asset in the country where the property is located can also be a good solution. At the same time, it is necessary to analyze in advance the laws of which state will be applied to the inheritance of property in the future – the country of permanent residence, location of the property or the one whose citizenship is the testator.

As for movable property (shares and shares of companies, bank accounts, art objects, etc.), if the last place of residence of the testator is Russia, then regardless of the place of issue of the will, you must contact the Russian notary and get a certificate of inheritance for action border and already with this certificate to go to the country where the asset is located, explains Ekaterina Markova. Thus, if a property is inherited according to the laws of the country where it is located, then the inheritance of movable property of the testator permanently residing in Russia, proceeds according to the Russian rules.

In general, it is necessary to prepare for the fact that the procedure of drawing up a will, recognition of the validity of a document and other nuances of accepting an inheritance abroad may be contrary to the usual Russian order. If there is no certainty according to which laws and regulations property will be inherited, it is necessary to rely on the strength of a will on “unfamiliar” territory. In addition, heirs can simultaneously open hereditary cases in all jurisdictions, and for each foreign notary can request duplicates of the Russian will, says Ekaterina Markova. According to Stanislav Zingel, president of the international agency Gordon Rock, inheritance by law as a whole is even safer and involves less risk, since the law is virtually impossible to challenge, unlike a testament.

International Trust or Private Foundation

Such a tool as trust is becoming a common practice for wealthy individuals abroad, but in Russia, it has not yet become widespread. Moreover, Russian legislation does not imply the existence of trust funds but does not prohibit investing in them abroad.

The establishment of trust allows the owner to transfer the assets to the trust management of his chosen trustee. As a result, the status of assets becomes, in a certain sense, isolated, neutral from a tax point of view. According to interviewed experts, in a number of US states, a trust may protect against inheritance tax or a tax on the formation of income from a trust. According to the trust agreement, the circle of elected persons, including the founder of the trust, also becomes the beneficiaries of transactions with assets.